What is SAFTA?
SAFTA Certificate of Origin
What is SAFTA Registration?
Benefits of certificate of origin under SAFTA / SAFTA Registration
SAFTA Registration Process in India
Step 1: Obtain an IEC Code
Step 2: Check Eligibility
Step 3: Submit the Application
Step 4: Verification of Documents
Step 5: Issuance of SAFTA Certificate of Origin
Documents Required for SAFTA Registration
To obtain a SAFTA Certificate of Origin, Indian exporters must provide the following documents:
- Import Export Code (IEC) certificate
- Commercial Invoice
- Purchase Bill with details of inputs or consumables used in export products
- Bill of lading or airway bill
- Product Details along with Packing list
- Purchase Order from Importer
- Bank certificate of export realization
- Declaration of the exporter stating that the goods being exported meet the SAFTA origin criteria.
- Letter of credit or contract, if applicable
- Organization Digital Signature Certificate with embedded IEC Code
- Registered Email on DGFT
- Mobile Number
- Updated IEC License
- DSC software must be installed on the system
Common errors and mistakes that businesses should avoid when applying for the SAFTA Certificate of Origin
Q1: Differences between the SAFTA Certificate of Origin and other certificates.
The key difference between the SAFTA Certificate of Origin and other certificates of origin is the specific trade agreement or scheme that they apply to. The SAFTA Certificate of Origin applies only to trade between SAFTA member countries, while other certificates of origin apply to trade under different agreements or schemes.
Another difference is the specific rules of origin that need to be met to qualify for preferential tariff treatment. The rules of origin for the SAFTA agreement may differ from those for other agreements or schemes, requiring different information and documentation to be provided when applying for the certificate.
It is important for businesses engaged in international trade to understand the different types of certificates of origin and which ones are applicable to their specific trade transactions. This can help them ensure compliance with the rules of origin and maximize the benefits of preferential tariff treatment under various trade agreements and schemes.
Q2: What is Certificates of Origin (CoO)?
Certificates of Origin (CoO) play a crucial role in international trade as they determine the country of origin of a product. A CoO is a document that proves the origin of a product and is issued by an authorized government agency. There are two types of CoOs – Preferential and Non-preferential.
Indian exporters must obtain a Preferential CoO from authorized Indian agencies to take advantage of preferential benefits under these trade agreements. The application for a Preferential CoO can be made online through the Common Digital Platform for issuance of certificate of origin of the Directorate General of Foreign Trade (DGFT), Department of Commerce.
On the other hand, non-preferential CoOs are issued for exports to countries that do not have a trade agreement with India. The purpose of a non-preferential CoO is to provide information about the origin of the goods and is usually requested by customs officials in the importing country.
Q3: Can you provide a list of tariff schemes that offer preferential rates?
Preferential CoOs are issued to exporters who are eligible for reduced or zero duty under various trade agreements.The list of preferential tariff schemes includes the followings:
- Generalised System of Preferences (GSP),
- Global System of Trade Preferences (GSTP),
- Asia Pacific Trade Agreement (APTA),
- South Asian Free Trade Area (SAFTA),
- SAARC Preferential Trading Arrangement (SAPTA),
- Indo-Sri Lanka Free Trade Agreement (ISFTA),
- India Afghanistan Preferential Trade Agreement (IAPTA),
- Indo Thailand Free Trade Agreement (ITFTA),
- Indo Singapore Comprehensive Economic Co-operation Agreement (CECA),
- Indo Chile Preferential Trade Agreement (ICPTA),
- India MERCOSUR Preferential Trade Agreement (IMPTA),
- India Korea Comprehensive Economic Partnership Agreement (IKCEPA),
- ASEAN India Free Trade Agreement (AIFTA),
- India Malaysia Comprehensive Economic Cooperation Agreement (IMCECA),
- India Japan Comprehensive Economic Partnership Agreement (IJCEPA),
- India-Mauritius Comprehensive Economic Cooperation and Partnership Agreement (IMCECPA), and
- India-UAE Comprehensive Economic Partnership Agreement (India-UAE CEPA).
It is important to note that all offices of Export Inspection Council (EIC) and Export Inspection Agencies (EIAs) are authorized to issue both preferential and non-preferential Certificates of Origin. Therefore, Indian exporters must obtain the appropriate CoO from the authorized agency depending on the destination country and trade agreement in question. Therefore, Indian exporters must obtain the appropriate CoO from the authorized agency depending on the destination country and trade agreement in question.
Q5: To what extent has SAFTA achieved its goals and objectives?
SAFTA has been successful in promoting regional trade and economic cooperation among its member countries. The agreement has led to a reduction in tariffs and an increase in market access for member countries. India has benefited greatly from the SAFTA agreement, with its exports to other member countries increasing significantly since the agreement’s implementation.
Q6: What are some of the challenges or limitations faced by SAFTA in promoting regional trade and economic integration?
Despite its successes, SAFTA faces several limitations, including non-tariff barriers, lack of infrastructure, and political tensions between member countries. Non-tariff barriers, such as complex customs procedures and technical regulations, hinder trade within the SAFTA region. Additionally, lack of infrastructure, including roads, ports, and communication networks, makes it difficult for businesses to transport goods within the region. Political tensions between member countries, such as the ongoing conflict between India and Pakistan, also limit the effectiveness of SAFTA.
In conclusion, the SAFTA Certificate of Origin is an essential document for businesses involved in trade within the SAFTA region. India, as a member country, has benefited from the SAFTA agreement, and obtaining the certificate can help Indian exporters take advantage of preferential tariff rates offered under the agreement. However, limitations such as non-tariff barriers, lack of infrastructure, and political tensions must be addressed to ensure the continued success of SAFTA in promoting regional trade and economic cooperation.
Q7: Is a SAFTA Certificate of Origin required for each invoice?
A SAFTA Certificate of Origin is required for each shipment, not for each invoice. The certificate must accompany the shipment and should be presented to the authorities of the importing country upon arrival. It is also important to ensure that the information provided in the SAFTA Certificate of Origin is accurate and complete. Any errors or discrepancies in the certificate could result in delays or rejection of the shipment. Therefore, it is advisable to seek the help of a consultant or an authorized agency to ensure that the certificate is properly filled out and submitted.
Q8: What is AEO Registration Number?
AEO stands for Authorized Economic Operator, which is a trade facilitation concept introduced by the World Customs Organization (WCO) in 2005. An AEO is a party involved in the international movement of goods that has been certified by the customs administration as complying with WCO or equivalent supply chain security standards.
An AEO registration number is a unique identifier assigned to an Authorized Economic Operator by the customs authority in the country where the operator is based. This registration number is used as a reference in all communications with the customs authorities for any AEO-related matters, including customs clearance procedures and security-related inspections. In India, the Central Board of Indirect Taxes and Customs (CBIC) grants AEO registration.